The credit card business is thriving because people are so accustomed to it. Some have gotten used to it and have mastered handling their finances with credit cards, but there are others who have failed miserably in doing so. It is very easy to find people who have invited their own downfall with bad financial decisions.
Managing credit cards well means maintaining a good credit score. Unfortunately, many people have bad credit scores, though some have managed to maintain a fair credit score. So what does fair credit score mean and why does it matter?
There is no formal definition that says so, but if your score lies between 640 and 680, you are said to be having a fair credit score. The credit score will impact you in many ways making or breaking ways to new opportunities at each stage.
The foremost concern is your self esteem. A good credit score will keep you in good spirits and have a positive impact on your self esteem. A fair credit score reflects the fact that you have defaulted in your payments. Though the situation is not out of control, you have to be very calculative moving forward to bring in a positive change with respect to your finances.
Secondly, any financial institution will trust people having good credit scores. A credit history that highlights the planned approach is appreciated by many and is taken as a proof that banks will count on. They trust such customers and loans are processed for them without any hassle. They may even be considered for loans with lesser rate of interest. Having a fair credit score cannot put you in that advantageous position.
Have you found it difficult to buy a house or apartment of late? Ever wondered if your fair credit score could be the reason? Financial stability is gauged based on a person’s credit score and may be your score is not sending out the right signals and you are losing out on opportunities.
The sooner you wake up to the fact that having a fair credit score is not good enough and work towards improving it, the faster you will get towards a comfortable life. You do not need great knowledge in finances to make it happen. You only have to understand your financial position, how much you earn, how much you can afford to spend and so on. Having multiple credit cards could also push you towards a lower credit score. Keep an eye on how you use the cards and stick to fewer cards to keep things simple.